Car Insurance Explained
Car insurance is something which we rarely think of, but all need. You may not spend a lot of time thinking about your policy unless you really need it. Most of us for this reason have little idea if we are really getting a good deal on our insurance. Learning a bit about car insurance can help you to avoid being taken in by smooth talking insurance salespeople and buying a policy with coverage you don’t really need.
The coverage which you are required to carry varies from state to state, as does the exact wording of the regulations in states with no-fault insurance; however, it is much the same in each state.
The first part of your policy is the collision and comprehensive coverage, which covers the automobile itself. Collision covers those trees which jump in front of your car and rude drivers who put their cars in the way of yours. Comprehensive includes damage and theft (hail, falling trees and the like).
The second section of the policy deals with your liability, the other guy?s damage if you caused the accident. The amount of coverage shows up in numbers. 25/50/10 for example means that the company won?t pay more than $25,000 per person and $50,000 total per accident. The 10 stands for $10,000 for property damage per accident.
Medical payments are there to cover any party involved in an accident, no matter who is at fault. Your car insurance policy also covers you in case you are hit by a car while walking. If you don’t have health insurance, this part of your car insurance helps to cover medical expenses. It may also cover medical expenses which your health insurance does not.
There will also generally be coverage in your policy to account for uninsured and underinsured drivers, which covers you if someone with no (or inadequate) coverage hits your car. This part of the policy also covers hit and runs, Towing coverage can also be added to your policy if you opt for liability as well as comprehensive and collision coverage for a low fee.
Keeping a few simple rules in mind can save you a lot of money on car insurance:
1. When it is time to renew your policy, get a variety of quotes and compare the prices. You can do a comparison of rates on many websites - however, look for quotes on insurance with the same coverage as you have now.
2. Look to see if there are discounts available from your home insurance company. There may be a price break available for buying both policies from the same company.
3. Ask if there are any available discounts. You may be able to get discounts if you are a young or higher risk driver, such as a young person or student. These discounts may be dependent on keeping up good grades or taking driving courses.
4. Make sure that you really need to cover your car. If you don’t have a loan on the car, you might find it cheaper to just let the comprehensive and collision part of your policy go. Compare the payments you will receive if the car gets totaled against the Kelly blue book value - If this amount is less than two years of your monthly premium, you may want to drop this coverage and use the savings for a newer vehicle. However, don’t be cheap when it comes to liability coverage; it is well worth the cost.
5.Consider getting a beater. These older cars are great for commuting to work and other short trips. Carry only liability insurance for this car and save your good car for special purposes. Carry full coverage on the good car and save wear and tear.
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